Janna Vigar, Partner in the Wills, Probate and Power of Attorney team at mfg Solicitors, Ludlow Office answers some frequently asked questions about Powers of Attorney:
I’ve got a Will, why do I need a Power of Attorney?
A Will comes into being when you pass away. Before your death, it has no use. A Will sets out who will deal with your money and property when you are gone. A Power of Attorney is a document that authorises someone (known as your ‘attorney’) who can be friend, relative or professional, to deal with your money and property and health issues before you die, i.e. whilst you are still alive.
You sign it whilst you are fit and well, and it is only activated if something happens to you, for example, if you are in a car accident and have a head injury, suffer a stroke and are unable to write or communicate, or if you are diagnosed with an illness like alzheimers or dementia.
There are lots of different names for Powers of Attorney. What do they mean?
The law setting out the requirements for Powers of Attorney changed in October 2007 when an Act of Parliament – the Mental Capacity Act was introduced. Before this date, you could prepare a document called an Enduring Power of Attorney. After this date, it was no longer possible to prepare these documents, but they are still valid and can be used if someone loses mental capacity.
Instead, the Act introduced Lasting Powers of Attorney (LPAs). There are two types: a LPA Financial Decisions which allows your attorney to deal with your money and property and the other is a LPA Health and Care which covers decisions about your health and wellbeing.
These documents are called either ‘Enduring’ or ‘Lasting’ because they can be used even if you no longer have mental capacity as opposed to General Powers of Attorney which are designed to deal with short term issues, such as allowing a solicitor to sign a contract for you if you are abroad.
When I spoke with my GP, I nominated my relative as Next of Kin. Does this mean I don’t need a Power of Attorney?
You very much still need a Power of Attorney. Next of Kin is a term that has been used for many years in hospitals and other healthcare settings, but which actually has no legal power whatsoever.
Many people understand the need for a LPA Financial Decisions: for example the need to authorise your attorney to sell your house for you if you are living with dementia and you need to go into care, but many are unaware of the importance of the Health one.
In many respects, this is more important than the financial one as it covers decisions about where you should live, who should care for you, what medical treatment you should receive and even goes as far as allowing your attorney to choose to decide whether you should be kept alive for example if you were on a life support machine. This ensures that the people you trust can carry out your wishes when you are seriously ill.
I understand you can make a LPA yourself online, why do I need to pay a Solicitor or Lawyer to help me?
These documents are extremely important – it is not simply a form filling exercise. You are allowing someone to have the power to sell your house and access your bank accounts and investments if need be and if you don’t obtain legal advice on them you could inadvertently expose yourself to a very high level of risk.
A report by Solicitors For the Elderly in November 2016 ‘The Hidden Cost of DIY LPAs’, outlines many other reasons why it is not a good idea to do them yourself which include errors on the forms leading to unforeseen financial costs, failure to properly express your wishes by not understanding the legal jargon and exposing yourself to fraud or coercion are just to name a few.
Ultimately, people choose to do them online because of cost. Everyone likes to avoid paying out money if they don’t have to. Here at mfg, we offer a fixed cost for preparing the documents, and given the importance of them, we believe that DIY LPAs are a false economy.
If you have any other questions about Powers of Attorney, or would like to go ahead with preparing LPAs, please do call Janna or one of her colleagues on 01584 873156 or email firstname.lastname@example.org
The Power of Attorney team are still able to help you even during the current lockdown.